Tan Kin Lian's Blog: How modern economics have failed us

Monday, October 03, 2011

How modern economics have failed us

This is an excellent article which explains that modern economics did not follow the teachings of Adam Smith. It has been allowed to stray from from the what the free market should be - i.e. freedom with responsibility. It explained how the financial sector made a lot of profit through excessive speculation and did not add any value in the process. Modern economics have operated on wrong principles and lack of morality.

6 comments:

Anonymous said...: Majority of us just want to work, form a family and raise our kids and retire at old age and live on our saving.

I doubt we will be able to do that because many of us will not have saving. Those who have saving will have hard time to fight inflation. Those who invest to hedge against inflation will be eaten alife.; October 03, 2011 9:16 PM
Anonymous said...: @ ANON 9.16pm

Exactly the reasons we elect politicians.

To serve and to protect the public.

So did we get what we voted for?
If not, why not?
And what are you going to do about it?; October 03, 2011 10:44 PM
Anonymous said...: King is always right. Superriches are the kingdom. Who are the servants of the kingdom?

Economist, finance & insurance insititution, politician....

The $ kingdom will NOT change.
Their indulgement will not change.

Ancient Chinese saying:
Got money, ghost are munupulated !; October 04, 2011 9:09 AM
Koh Lip Wee said...: This is a good article.

Not only modern economics originated from post Feudalism and Anglo-Saxon era are flawed, contemporary finance theories (as well as financial engineering) are also quite incorrect and misleading in some aspects.

However, I belief the larger gravity to this heavy issue does not lies with these mere theories but 'selective (self-centred) execution' and 'weak (mainly due to short-term) leadership' by key world politicians today.

They tend to pursue short-term economic policies on the supply side that focuses on monetary policy (i.e. control of money supply which are usually 'quick-fixed' solutions but cannot solve long-term structural challenges effectively), without actually addressing the fiscal discipline effectively (i.e. tax, saving and investment, as well as balance of payments).

We are as strong as the weakest link.
When the weak and poor are perpetually oppressed and helpless, this will create social tensions and unrest ('class' struggle in Marxist terminology) which we are seeing these days, in the form of 'Arbab Spring or even Wall Street protests' etc.

Of course Marxism is never the solution to the world problem today, but policy makers need to think hard between balancing 'production / resources maximisation' versus 'equitable economic distribution'.
Extreme capitalism and elitism is simply not the way to go.

Lip Wee; October 04, 2011 9:57 AM
Anonymous said...: Take charge of your own life and destiny.

#1 do not buy if you have no need
#2 Buy what you can afford
#3 Save enough for crisis
#4 Read & learn about the world
#5 Smile and laugh often

Politicians,businessmen,people in general, are just like you. They are not different.

The difference, if any, is that they do 3 out of the 5 points.; October 04, 2011 10:23 AM
Anonymous said...: You do not have savings not because you are lazy, jobless, incompetent, or just plain unlucky. You do not have enough savings because you have been robbed by an extreme Capitalistic system. A system that is abused by those in power and their business cronies and network.; October 04, 2011 1:37 PM